Editor's Note: Construction (decoration) companies are now facing intense market competition. For small and medium-sized enterprises, breaking through in this fierce environment is particularly challenging. To succeed in the competitive bidding process, it's essential to master bidding techniques and understand the rules of the game. Mr. Zhu Xibin’s book, "Construction (decoration) Enterprises Participating in Project Bidding and Bidding to Improve the Bidding Rate," provides a comprehensive guide on legal norms related to bidding, strategies to increase the bid-winning rate, and practical training for business personnel. This article summarizes key chapters from the book, aiming to offer valuable insights for those involved in bidding and the industry.
Chapter 1: Construction (decoration) enterprises participating in bidding
Applicants should be familiar with relevant regulations
To improve the bid-winning rate, construction (decoration) enterprises must have a thorough understanding of domestic tendering and bidding procedures. The author, with over 20 years of experience in bidding and evaluation, outlines four key aspects. The first step is to understand and comply with relevant laws and regulations.
1. The People's Republic of China Bidding Law (optional)
General Provisions
Article 1: This law aims to regulate bidding and tendering activities, protect national interests, social public interests, and the legitimate rights and interests of parties involved, improve economic efficiency, and ensure project quality.
Article 5: Bidding and tendering activities should follow the principles of openness, fairness, impartiality, and good faith.
Article 7: Bidding and tendering activities and their participants shall accept supervision according to law.
Tender
Article 10: Tendering is divided into open tendering and invitation tendering.
Article 21: The tenderer may organize potential bidders to explore the project site based on the bidding project and specific conditions.
Bid
Article 25: A bidder is a legal person or organization that responds to the bidding and participates in the competition.
Article 26: A bidder must have the ability to undertake the bidding project. If the state has specific qualification requirements, the bidder must meet them.
Article 27: Bidders must prepare bidding documents as per the requirements of the bidding documents. The documents should respond to the substantive requirements and conditions outlined in the bidding documents.
The bidding project involves construction. The contents of the bidding documents should include resumes, performance records, and mechanical equipment of the project leader and main technical personnel to be dispatched.
Article 28: Bidders must deliver the bidding documents to the designated location before the deadline specified in the bidding documents. After receiving the documents, the tenderer shall sign for receipt and not open them. If there are less than three bidders, the tenderer shall re-tender according to this law.
Article 29: Before the deadline for submitting the bid, the bidder may supplement, modify, or withdraw the submitted documents and notify the tendering party in writing. The added content becomes part of the bid document.
Article 30: If the bidder intends to subcontract non-critical parts of the winning project after winning, it should be stated in the bid documents as per the project's actual conditions.
Article 31: Two or more legal persons or organizations may form a consortium to bid together. All members must have the capability to undertake the project. If the state has qualification requirements, all members must meet them. A consortium consisting of units of the same profession will be assessed based on the lowest qualification level.
All members of the consortium must sign a joint bidding agreement, clarify their responsibilities, and submit it along with the bidding documents. If the consortium wins, they must jointly sign a contract with the tenderer and assume responsibility for the winning bid.
The tenderer shall not force bidders to form a joint bid or limit competition between bidders.
Article 32: A bidder may not bid below cost, nor may they bid under another's name or falsify information to defraud the win.
Bid Opening, Bid Evaluation and Winning
Article 36: During the bid opening, the bidder or representative elected by him shall check the sealing of the bid documents, which may be inspected and notarized by a notary public commissioned by the tenderer. After confirmation, staff will open and read the documents publicly, including the bidder's name, bid price, and other major contents.
Article 39: The bid evaluation committee may require the bidder to clarify or explain unclear content in the bid documents, but such clarification or explanation shall not exceed the scope of the documents or change the substantive content.
Article 41: The winning bid must meet one of the following conditions:
(1) It can fully meet the comprehensive evaluation criteria specified in the bidding documents.
(2) It can meet the substantive requirements of the bidding documents.
Article 45: Once the successful bidder is determined, the tenderer shall issue a notice of winning the bid to the successful bidder and notify all unsuccessful bidders. The notice has legal effect on both parties. If the tenderer changes the result or the bidder waives the bid, they shall bear legal responsibility.
Article 46: The tenderer and the successful bidder shall conclude a written contract within 30 days of the bid-winning notice. They may not enter into agreements that deviate from the contract's substantive content. If the bidding documents require a performance bond, the successful bidder shall submit it.
Article 48: The successful bidder must complete the project as stipulated in the contract. They may not transfer the project or subdivide it and transfer it to others. Subcontracting non-critical work to others is allowed with the consent of the tenderer. Those who receive subcontracted work must have the necessary qualifications and may not subcontract again.
The successful bidder shall be responsible to the tenderer for the subcontracted project, and the subcontractor shall bear joint liability for the project.
Legal Liability
Article 53: If bidders collude or bribe the tendering party or evaluation committee, the winning bid is invalid, and fines ranging from 5% to 10% of the bid amount will be imposed. Illegal gains will be confiscated. Serious cases may lead to disqualification from bidding for 1-2 years, and the business license may be revoked. Criminal responsibility will be pursued if applicable.
Article 54: If a bidder bids under another's name or falsifies information to defraud the bid, the winning bid is invalid. The bidder shall compensate for any losses caused to the tenderer and face criminal charges if applicable.
Article 58: If the successful bidder transfers the project or subcontracts it improperly, the transfer or subcontracting is invalid. Fines will be imposed, and the business license may be revoked. If the contract cannot be fulfilled due to force majeure, the provisions do not apply.
Supplementary Provisions
Article 65: If bidders or interested parties believe the bidding process violates the law, they may file an objection with the tenderer or complain to the relevant administrative department.
Article 68: This law comes into effect on January 1, 2000.
2. The People's Republic of China Government Procurement Law (optional)
Article 1: This law aims to regulate government procurement behavior, improve the efficiency of fund usage, protect national and public interests, safeguard the legitimate rights of procurement parties, and promote the building of a clean government.
Article 2: The term "procurement" refers to obtaining goods, works, and services on a contractual basis, including purchase, lease, entrustment, employment, etc.
Goods refer to various forms and types of goods, including raw materials, fuels, equipment, products, etc.
Engineering refers to construction projects, including the construction, renovation, expansion, and repair of buildings and structures.
Services refer to other government procurement targets.
Article 4: The applicable bidding method for government procurement projects.
Article 21: Suppliers are entities that provide goods, engineering, or services to the purchaser.
Article 22: Suppliers participating in government procurement must meet the following conditions: having the ability to independently bear civil liability, maintaining a good business reputation, having a sound financial system, possessing the necessary equipment and professional capabilities, having a good record of tax and social security payments, and no major illegal records in the past three years.
Article 23: The purchaser may request suppliers to provide relevant qualification documents and review their qualifications based on the supplier conditions and the specific requirements of the procurement project.
Article 25: Suppliers must not bribe or use improper means to obtain the bid or transaction.
Government Procurement Contract
Article 43: The contract law applies to government procurement contracts.
Article 48: With the approval of the purchaser, the successful supplier may perform the contract through subcontracting.
Complaints and Appeals
Article 51: Suppliers may raise inquiries about the procurement process to the procurement personnel.
Article 53: If a supplier believes that the procurement documents, process, or results have damaged their rights, they must raise the question in writing within seven working days from the date of knowledge.
Legal Liability
Article 77: If a supplier engages in any of the following behaviors, they will be fined, banned from participating in government procurement for 1-3 years, and their business license may be revoked. If the circumstances are serious, criminal responsibility will be pursued.
Article 83: Any unit or individual obstructing or restricting suppliers from entering the local or industry procurement market will be ordered to correct within a time limit. If they refuse to correct, the responsible individuals will be punished.
Supplementary Provisions
Article 88: This law comes into effect on January 1, 2003.
3. Beijing Bidding Regulations (Selected)
General Provisions
Article 1: These regulations aim to regulate bidding and tendering activities, in accordance with the "People's Republic of China Bidding and Tendering Law" and other laws, combined with the city's actual situation.
Article 2: These regulations apply to bidding activities for engineering construction, cargo service procurement, and other projects in the city.
Bidding
Article 23: Bidders must not collude to raise or lower bid prices, or use bribes to gain an unfair advantage. They must not bid under another's name or at a price below cost.
Bid Opening, Bid Evaluation and Winning
Article 31: The winning bid must meet one of the following conditions:
(1) It can fully meet the comprehensive evaluation criteria specified in the bidding documents.
(2) It can meet the substantive requirements of the bidding documents, with the lowest evaluated bid price, except when the bid price is below cost.
Article 38: If the tenderer collects a bid bond, it must return it to the successful and unsuccessful bidders within 5 working days after signing the contract with the successful bidder.
Legal Liability
Article 50: Violations of Article 23 of these regulations will result in penalties, including the cancellation of participation in government investment and financing projects for 3-5 years, and public announcements.
Supplementary Provisions
Article 53: These regulations come into effect on November 1, 2002.
4. Other Laws and Regulations That Must Be Mastered
On July 27, 2001, the State Planning Commission issued Notice [2001] No. 1400, emphasizing the implementation of the Bidding and Tendering Law, clearing regional blockades, and establishing a unified market. It emphasized the need for transparency, fair access, and standardized evaluation activities.
On July 5, 2001, the Interim Provisions on the Bid Evaluation Committee and the Bid Evaluation Method were issued. Article 57 states that if the successful bidder does not sign a contract, the bid bond will not be refunded, and the bidding qualification will be canceled.
On February 22, 2003, the State Planning Commission issued Decree No. 29, focusing on the management of bid evaluation experts.
Local Bidding and Tendering Regulations and Related Regulations.
On February 4, 2013, the Eight Ministerial Decree No. 20, "Electronic Tendering and Bidding Measures," was issued.
Chapter 2: Cases of Bidding and Exemption Standards Occurred in Practice
1. Cases and Reasons for the Rejection of the Standard
Several cases occurred where bids were rejected due to violations of bidding standards. These included issues such as exceeding the budget, providing incomplete documentation, and failing to meet technical specifications.
2. Several Kinds of Situations of the Waste Mark Are Combined, and the Bids of One of the Following Cases Shall Be Judged as Scrapped
If the bid documents violate the substantive provisions of the bidding documents and constitute significant deviations, the bid will be considered invalid. This includes failing to provide bid security, not signing the documents, exceeding the project timeline, and not meeting technical standards.
Chapter 3: Improves Architectural Decoration
Five Links of the Bidding Rate of Enterprise Bidding
Building (decoration) enterprises face market bidding, which is a market economy. Whether in Beijing, across the country, or even globally, competition is normal. Every enterprise must adapt to fierce competition, bid more, win more, and strengthen the enterprise.
1. Create a Corporate Brand
Creating a strong brand helps enterprises expand their influence, participate in more bids, and win more. This includes meeting credit requirements, quality certifications, and performance indicators.
2. Master the Bidding Information for Architectural Decoration Projects
Collecting and tracking information on construction and decoration projects across regions and industries is crucial. This includes analyzing project needs, identifying key stakeholders, and preparing for bids effectively.
3. Do a Good Job in Project Design
Designing a project that meets the owner's needs, reflects trends, and uses new technologies is essential. This includes creating a design plan that is innovative, efficient, and environmentally friendly.
4. Do a Good Job in Pre-Qualification Bidding
Pre-qualification ensures that only qualified bidders participate. This includes verifying the bidder's qualifications, performance, and technical capabilities.
5. Prepare the Bidding Documents Effectively
Preparing high-quality technical and commercial bids is critical. Technical bids must meet the required standards, while commercial bids should reflect competitive pricing strategies.
6. Master the Six Key Steps in Bidding
Understanding the bidding process, leveraging company strengths, optimizing costs, and ensuring accurate documentation are essential steps. Each stage requires careful planning and execution to increase the chances of winning bids.
Finally, businesses must maintain a strong corporate culture, invest in employee development, and stay updated on legal and industry standards to remain competitive in the ever-evolving market.
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